Magazine Industry Looks to Create ITunes for Print

Publishers Don't Want Apple Tablet to Take Over Reader Relationship

NEW YORK (AdAge.com) -- Traditional publishers -- concerned that Apple's anticipated tablet computer could affect their business the way the iPod disempowered music publishers -- are discussing possible strategies, including an industry-wide digital storefront where tablet users could buy digital issues or subscriptions without going through iTunes or the App Store.

It's true that magazine and newspaper publishers are eager to sell digital editions tailored for the tablet and other devices -- but they're just as determined to prevent Apple from getting between them and their readers along the way. They saw how Apple dictated music prices on iTunes, where for a long time the world learned that every song was worth 99 cents, no less and no more. And they've watched Amazon exert total control over the magazine and newspaper subscriptions it sells on the Kindle, refusing to provide publishers any information about their own subscribers through the Kindle Store.

If the Apple tablet that many expect early next year proves popular for flipping through tailored editions of magazines and newspapers, Apple's iTunes or App Store could become chokepoints between readers and publishers.

"There's a lot of activity right now at all of the major newspaper and magazine publishers around 'What is our role?'" said one magazine executive this week, who declined to speak on the record because of the sensitivity around interactions with Apple. "A lot of the conversations are around 'We need to control the customer relationship.' We are not interested in doing an Amazon thing or even an Apple thing where they own the data."

Information about subscribers is important in a number of ways. Details about the audience make advertising more attractive to marketers, help publishers sell other titles and products to their existing subscribers and underpin the database-marketing services that publishers are increasingly offering.

Retaining control
An industry storefront would let publishers retain that information, not to mention full control over pricing, the executive said. "That storefront would live on the Apple tablet," this person said. "You'd have an icon for this store where you could get your magazines or newspapers."

Music executives didn't see much choice when Steve Jobs signed them up to sell songs and albums through iTunes, a newspaper executive recalled. "People put their hands out and let him put the handcuffs on them," he said. "The same thing now is happening with the publishing industry. They are afraid to do anything, to say anything. At the same time, they're saying, 'Let's see what other options we have.'"

It's striking that publishers are considering collaborating on a storefront, said a second magazine executive who confirmed the conversations, including the storefront concept. But the rise of digital media is pushing publishers toward certain kinds of collaboration, he said. "I have been involved myself and have heard about discussions among companies on a number of different initiatives that would involve consumer publishers sharing resources in a way they never would have in the old-fashioned print-only world," he said.

Whether they build an industry storefront or pursue other strategies, the overriding idea is to make the most of new reading devices -- without letting the devices and their makers gain all the control. "In the music industry, the iPod itself had the dominant control over the experience," another magazine executive said. "Once the iPod controlled the experience and was the element that was the most dramatic improvement, the content became a commodity on the device, and the device became the experience."

"If publishers were to get together and agree at least on what the format would look like," he added, "then the device companies don't dictate so much that they define pricing and distribution."

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Nat Ives

Nat Ives is executive editor at Advertising Age. He first joined Ad Age in 2005 as a reporter on the publishing beat. He previously helped cover the media and ad industries as a news assistant at The New York Times and reported on commercial real estate for Institutional Investor newsletters. He graduated from the Columbia University Graduate School of Journalism in 2001.